Insurance

• Title Insurance
• Homeowners
• Renters
• Home Inventory
• Service Contracts

Title Insurance

Your title insurance policy is a contract between you (the owner of a parcel of land) and a title insurance company.

It guarantees:

1. That the homeowner (seller) is in fact the owner of the land described and his title is good against every other claim except as stated in the policy. This is one of the most important reasons for purchasing title insurance because it is your guarantee of absolute ownership.

If it is later found that the seller is not the true property owner, the title insurance company will pay to you, under your owner policy, an amount equal to the loss you suffer as a result, calculated on the price paid for the property at the time of the original closing.

If your home were lost to an outside claimant, the face amount of the policy is your maximum recovery.

If only a part of the land on which the home is situated is lost, only a portion of the policy amount will be paid, based on the purchase price or value of the property at the time of the original closing, NOT upon the fair market value of the property at the time the loss occurred. However, you may buy increased amounts of insurance as your home appreciates in value.

You are protected against fraud, forgery (whether the forgery occurred 1 year, 50 years, or 100 years previously) and claims by missing heirs or children.

You are also protected against mechanic’s lien claims for unpaid bills when you purchase a new home.

2. That the title to the land insured is clear of all encumbrances to the title (except as stated in the policy) including:

• mortgages or liens
• servitudes
• easements
• restrictions
• oil & gas leases
• outstanding mineral interests
• leases for other uses of the land including pasture leases and crop leases
• other third party tenancies

Prior to the purchase of your home or other parcel of land you may request the title insurance company to issue a title report (called a commitment) to the prospective homebuyer or his attorney. This is a commitment by the title insurance company to issue a title insurance policy in the amount stated in the title report in accordance with the matters set forth in the title report.

A prospective buyer has the right to receive a commitment if he is placing a bonafide order for a title policy. There is no charge for issuing a title commitment in Texas.

3. That all property taxes, including state ad valorem, city & school taxes, have been paid against the subject property, except for the year in which the property is sold and subsequent years.

Insuring your home

Whether you rent or own your home, insurance can help you protect your personal property as well as your home itself. It’s important to insure your personal possessions against loss. Repairs and/or replacement costs could be high without insurance, since the average person’s belongings are valued at more than $20,000.

For Homeowners

A homeowner’s insurance policy protects you from damage that may affect the value of your home. A standard homeowner’s policy also includes personal liability and theft coverage.

Homeowner’s insurance also protects your personal property. It’s important to make an inventory of your possessions. Your inventory [link to inventory section below] will help you decide how much homeowner’s insurance you need to carry. It can also help you get your belongings returned or replaced if they are stolen.

Make detailed records your personal property, especially items like the following (which may be hard to value once they are lost):

• antiques
• jewelry
• silver
• original art
• sporting goods
• major appliances
• collector’s items

For Renters

Renter’s insurance covers the replacement value of possessions for those who rent or lease their living space.

While your landlord carries insurance on the building you live in, it is unlikely that insurance would cover your personal possessions if they are lost in a fire or a break-in. Renter’s insurance can include liability coverage to protect you if someone gets hurt at your residence and can be written to cover legal defense costs.

Coverage under a renter’s insurance policy is similar to a homeowner’s policy. Your insurance should cover:

• clothing
• TV
• stereo
• appliances
• other personal property

Look for a policy that provides replacement value coverage rather than current value. Your policy will probably include a deductible – the cost you would need to cover yourself in case of a claim. Choosing a higher deductible will lower the cost of the policy. Take an inventory [link to inventory section below] of your possessions so you will know how much insurance you need.

Renter’s insurance coverage is fairly broad. It can cover items stolen from your car while you are on vacation, for example. You are only protected from hazards specifically listed in your policy, though, so be sure to read it carefully.

Taking Inventory

An inventory of the items in your home will help you determine how much insurance coverage you will need. Although it means an investment of time on your part, doing the inventory will help you place a value on your belongings.

Total the estimated value of your possessions to get a rough idea of what your personal property is worth. Your insurance agent will help you determine the level of coverage that will give you the protection you need at a price that is comfortable.

Inventory Tips

• Make a room-by-room inventory of your home.
• Make a written list, record an audio inventory or make a photographic or video inventory.
• Record serial numbers, model numbers, and any other information that would help in identifying and replacing lost items.
• Keep careful records of “irreplaceable” items like jewelry, paintings, antiques, etc.
• Start in one corner of each room and work your way around to list or record everything in that room.
• Don’t forget to inventory closets, the attic, the garage, the basement (if you have one), and any storage sheds.
• As you make new purchases, replace or get rid of items don’t forget to update your inventory.

Photo or Video Inventory Tips

• Use a camera with a flash (film or digital) or a video camera.
• Use color film.
• Date photos, slides, digital pictures or videos.
• Take wide-angle shots of an entire room first.
• Work your way around that room, taking close-ups to show detail.
• Photograph serial and model numbers of appliances, stereos, TVs, and computer equipment.
• Include shots of front, back and sides of antique furniture
• Focus your flash away from mirrors and other reflective surfaces by standing at a 45 degree angle to the shiny surface.
• Stay within the recommended focus range for close-ups.
• Open glass doors to prevent reflection.
• Place a family member in photos to verify ownership.
• Photograph closets with doors open to indicate the quantity of clothing.
• Take pictures of the insides of drawers with the contents fanned out as much as possible.
• Use a dark, non-reflective cloth as a background for photos of silver, jewelry, china, glassware, sculpture.
• Angle the camera to photograph jewelry to avoid glare.
• Photograph the pattern name and manufacturer’s name on the bottom of your china, as well as the pattern.
• When photographing or recording collections in albums (like coins or stamps) be sure to photograph the entire page, one page at a time, with close-ups of the most valuable items
• Photograph your power tools, including detailed photos of the inside of our tool box.

Service Contracts

Mid Town Realtors can help you secure a service contract on your new home. This is a policy that covers the working components of the house (AC/CHA, plumbing, wiring, etc.) that may not be covered under standard home owners policies. We help negotiate the service contract as part of your closing.

Limited coverage is also available for the seller during the listing period.

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